Wanda wants to open a health-food store. Her monthly expenses are rent$3,500, utilities of $1,000, insurance of $500, and payroll of $4,250. Sheestimates that her cost of goods is approximately 65 percent of sales. Wandawould like to make $4,000 a month for herself.a. What is Wanda’s contribution margin?b. How much does she need in monthly sales to break even? c. How much does she need in monthly sales to make a profit of $4,000?d. Construct a break-even chart for Wanda’s health-food store.

Wanda wants to open a health-food store. Her monthly expenses are rent$3,500, utilities of $1,000, insurance of $500, and payroll of $4,250. Sheestimates that her cost of goods is approximately 65 percent of sales. Wandawould like to make $4,000 a month for herself.a. What is Wanda’s contribution margin?b. How much does she need in monthly sales to break even? c. How much does she need in monthly sales to make a profit of $4,000?d. Construct a break-even chart for Wanda’s health-food store.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter16: Tax Research

Section: Chapter Questions

Problem 64DNC

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Wanda wants to open a health-food store. Her monthly expenses are rent $3,500, utilities of $1,000, insurance of $500, and payroll of $4,250. She estimates that her cost of goods is approximately 65 percent of sales. Wanda would like to make $4,000 a month for herself. What is Wanda’s contribution margin? How much does she need in monthly sales to break even? How much does she need in monthly sales to make a profit of $4,000? Construct a break-even chart for Wanda’s health-food store.
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